ALL INDIA RADIO (AIR) DISCUSSION : Benefits extended to workers in unorganised sector
The Topic covers GS paper 2 : Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and Bodies constituted for the protection and betterment of these vulnerable sections.
The creation of Pradhan Mantri Shram Yogi Mandhan, a pension scheme for informal workers was a major announcement in the Interim Budget 2019-20.
Who comprise unorganised workers?
Half of India’s GDP comes from the work done by 42 crore workers in the unorganised sector, such as
- street vendors
- rickshaw pullers
- construction workers
- rag pickers
- agricultural workers
- beedi workers
- those engaged in the handloom and leather industries
- domestic workers
What is Shram Yogi Mandhan scheme?
- The Shram Yogi Mandhan scheme is aimed at achieving a “comprehensive social security coverage” in their old age.
- Therefore includes all informal sector workers with an income of less than ₹15,000 per month.
- According to the government, this works out to 10 crore people.
- Under this scheme, subscribers will receive an assured monthly pension of ₹3,000 per month from the age of 60 onwards.
- owards this, they will have to contribute ₹55 a month (if they join at the age of 18 years), or ₹100 a month (if they join at the age of 29 years).
- The government will match these contributions.
How will the scheme work?
- Social sector workers have pointed out that creating a voluntary contributory pension scheme for informal sector workers is not likely to work as their salaries are low.
- The argument is that they already pay large amounts as indirect taxes.
- It must be recognised that this scheme isn’t very different from the Atal Pension Yojana which was launched in 2015.
- Further, for a salaried worker, the pension contribution can be cut from the salary.
- A daily wage earner or migrant labourer will, however, have to regularly deposit her income each month, which is an uncertain proposition.
What is the way forward?
- The government needs to answer on what happens to the scheme if an informal sector worker misses a contribution.
- Also what happens if the worker becomes disqualified and what happens to the already paid amount.
- Another matter to be considered is what happens to a worker who transitions to the formal workforce.